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LUKE Foley has resigned as NSW Labor leader after an ABC journalist accused him of putting his hand down her underpants at a Christmas party in 2016.

Mr Foley says the accusations are false but announced on Thursday he will be quitting the post after reporter Ashleigh Raper detailed the allegations in a statement.

Ms Raper wanted to "set the record straight" about the incident involving the state opposition leader at the 2016 NSW Parliament Christmas party a bar in Sydney's CBD amid widespread speculation.

In the statement Ms Raper said Mr Foley called her on Sunday to apologise, telling her: "I'm not a philanderer, I'm not a groper, I'm just a drunk idiot".

He told her he would resign as leader of the NSW Labor Party either on Monday or Wednesday.

However, he called back on Tuesday to backtrack, saying he won't be resigning based on legal advice.

In her statement she said the incident that had been the source of widespread speculation involved Mr Foley putting his hand down the back of her dress at a bar in Martin Place following the function involving politicians, their staff and journalists at Parliament House.

"He stood next to me. He put his hand through a gap in the back of my dress and inside my underpants. He rested his hand on my buttocks. I completely froze," she said.

She said the incident was witnessed by another journalist, but she did not make a complaint for a number of reasons - including for fear of losing her job and the negative impact it would have on her family.

But the matter resurfaced in October when Liberal minister David Elliott raised it in NSW parliament.

“The matter then became a state and federal political issue and resulted in intense media attention. This occurred without my involvement or consent.”

Ms Raper said women “should be able to go about their professional lives and socialise without being subject to this sort of behaviour”.

“And I want it to stop.”

The ABC said it was “extremely unfortunate” that media and public pressure had caused Ms Raper to speak publicly on an issue she didn’t want to pursue or comment on.

“There is absolutely no suggestion of any wrongdoing by Ms Raper and her career should not be affected in any way,” the public broadcaster said in a statement.